☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 |
MASSACHUSETTS | 04-3284048 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Class A Common Stock. 0 1 par value | SAM | New York Stock Exchange | ||
Class B Common Stock, 0 1 par value | Not applicable | Unregistered |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ | Small | ☐ | |||
Emerging growth company | ☐ |
Class A Common Stock, $.01 par value | ||||
Class B Common Stock, $.01 par value | ||||
(Title of each class) | (Number of | ) |
PART I. | PAGE | |||||||||||
Item 1. | 3 | |||||||||||
3 | ||||||||||||
4 | ||||||||||||
5 | ||||||||||||
6 | ||||||||||||
7- 19 | ||||||||||||
Item 2. | 20- 26 | |||||||||||
Item 3. | 26 | |||||||||||
Item 4. | 27 | |||||||||||
PART II. | ||||||||||||
Item 1. | 27 | |||||||||||
Item 1A. | 27 | |||||||||||
Item 2. | 28 | |||||||||||
Item 3. | 28 | |||||||||||
Item 4. | 28 | |||||||||||
Item 5. | 28 | |||||||||||
Item 6. | 29 | |||||||||||
30 |
Item 1. | CONSOLIDATED FINANCIAL STATEMENTS |
June 29, | December 29, | |||||||
2019 | 2018 | |||||||
Assets | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 3,017 | $ | 108,399 | ||||
Accounts receivable | 69,420 | 34,073 | ||||||
Inventories | 80,361 | 70,249 | ||||||
Prepaid expenses and other current assets | 16,329 | 13,136 | ||||||
Income tax receivable | 9,629 | 5,714 | ||||||
Total current assets | 178,756 | 231,571 | ||||||
Property, plant and equipment, net | 412,064 | 389,789 | ||||||
Operating right-of-use assets | 36,779 | — | ||||||
Merger consideration | 158,402 | — | ||||||
Other assets | 23,646 | 14,808 | ||||||
Goodwill | 3,683 | 3,683 | ||||||
Total assets | $ | 813,330 | $ | 639,851 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 74,906 | $ | 47,102 | ||||
Accrued expenses and other current liabilities | 73,545 | 73,412 | ||||||
Line of credit | 37,500 | — | ||||||
Current operating lease liabilities | 2,315 | — | ||||||
Total current liabilities | 188,266 | 120,514 | ||||||
Deferred income taxes, net | 55,452 | 49,169 | ||||||
Non-current operating lease liabilities | 39,239 | — | ||||||
Other liabilities | 7,572 | 9,851 | ||||||
Total liabilities | 290,529 | 179,534 | ||||||
Commitments and Contingencies (See Note I) | ||||||||
Stockholders’ Equity: | ||||||||
Class A Common Stock, $.01 par value; 22,700,000 shares authorized;8,655,955 and 8,580,593 issued and outstanding as of June 29, 2019 and December 29, 2018, respectively | 87 | 86 | ||||||
Class B Common Stock, $.01 par value; 4,200,000 shares authorized;2,917,983 and2,917,983 issued and outstanding as of June 29, 2019 and December 29, 2018, respectively | 29 | 29 | ||||||
Additional paid-in capital | 416,602 | 405,711 | ||||||
Accumulated other comprehensive loss, net of tax | (1,155 | ) | (1,197 | ) | ||||
Retained earnings | 107,238 | 55,688 | ||||||
Total stockholders’ equity | 522,801 | 460,317 | ||||||
Total liabilities and stockholders’ equity | $ | 813,330 | $ | 639,851 | ||||
September 28, | December 29, | |||||||
2019 | 2018 | |||||||
Assets | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 27,128 | $ | 108,399 | ||||
Accounts receivable | 68,687 | 34,073 | ||||||
Inventories | 92,632 | 70,249 | ||||||
Prepaid expenses and other current assets | 14,965 | 13,136 | ||||||
Income tax receivable | 5,980 | 5,714 | ||||||
Total current assets | 209,392 | 231,571 | ||||||
Property, plant and equipment, net | 521,316 | 389,789 | ||||||
Operating right-of-use assets | 38,943 | — | ||||||
Goodwill | 112,529 | 3,683 | ||||||
Intangible assets | 104,335 | 2,099 | ||||||
Other assets | 29,661 | 12,709 | ||||||
Total assets | $ | 1,016,176 | $ | 639,851 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 71,035 | $ | 47,102 | ||||
Accrued expenses and other current liabilities | 92,850 | 73,412 | ||||||
Current operating lease liabilities | 2,599 | — | ||||||
Total current liabilities | 166,484 | 120,514 | ||||||
Deferred income taxes, net | 81,653 | 49,169 | ||||||
Non-current operating lease liabilities | 41,215 | — | ||||||
Other liabilities | 7,844 | 9,851 | ||||||
Total liabilities | 297,196 | 179,534 | ||||||
Commitments and Contingencies (See Note J ) | ||||||||
Stockholders’ Equity: | ||||||||
Class A Common Stock, $.01 par value; 22,700,000 shares authorized; 9,216,022 and 8,580,593 issued and outstanding as of September 28, 2019 and December 29, 2018, respectively | 92 | 86 | ||||||
Class B Common Stock, $.01 par value; 4,200,000 shares authorized; 2,817,983 and 2,917,983 issued and outstanding as of September 28, 2019 and December 29, 2018, respectively | 28 | 29 | ||||||
Additional paid-in capital | 568,047 | 405,711 | ||||||
Accumulated other comprehensive loss, net of tax | (1,154 | ) | (1,197 | ) | ||||
Retained earnings | 151,967 | 55,688 | ||||||
Total stockholders’ equity | 718,980 | 460,317 | ||||||
Total liabilities and stockholders’ equity | $ | 1,016,176 | $ | 639,851 | ||||
Thirteen weeks ended | Twenty-six weeks ended | |||||||||||||||
June 29, | June 30, | June 29, | June 30, | |||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenue | $ | 338,643 | $ | 289,574 | $ | 606,202 | $ | 491,405 | ||||||||
Less excise taxes | 20,236 | 16,474 | 36,144 | 27,848 | ||||||||||||
Net revenue | 318,407 | 273,100 | 570,058 | 463,557 | ||||||||||||
Cost of goods sold | 159,405 | 131,130 | 286,516 | 225,490 | ||||||||||||
Gross profit | 159,002 | 141,970 | 283,542 | 238,067 | ||||||||||||
Operating expenses: | ||||||||||||||||
Advertising, promotional and selling expenses | 94,079 | 86,510 | 165,802 | 154,031 | ||||||||||||
General and administrative expenses | 26,748 | 23,879 | 50,122 | 43,217 | ||||||||||||
Impairment of assets | 243 | 517 | 243 | 517 | ||||||||||||
Total operating expenses | 121,070 | 110,906 | 216,167 | 197,765 | ||||||||||||
Operating income | 37,932 | 31,064 | 67,375 | 40,302 | ||||||||||||
Other income (expense), net: | ||||||||||||||||
Interest (expense) income, net | (27 | ) | 273 | 610 | 478 | |||||||||||
Other income (expense), net | 197 | (203 | ) | (55 | ) | (488 | ) | |||||||||
Total other income (expense), net | 170 | 70 | 555 | (10 | ) | |||||||||||
Income before income tax provision | 38,102 | 31,134 | 67,930 | 40,292 | ||||||||||||
Income tax provision | 10,246 | 7,599 | 16,380 | 7,447 | ||||||||||||
Net income | $ | 27,856 | $ | 23,535 | $ | 51,550 | $ | 32,845 | ||||||||
Net income per common share - basic | $ | 2.39 | $ | 1.99 | $ | 4.42 | $ | 2.78 | ||||||||
Net income per common share - diluted | $ | 2.36 | $ | 1.98 | $ | 4.38 | $ | 2.76 | ||||||||
Weighted-average number of common shares - Class A basic | 8,648 | 8,667 | 8,627 | 8,690 | ||||||||||||
Weighted-average number of common shares - Class B basic | 2,918 | 3,018 | 2,918 | 3,018 | ||||||||||||
Weighted-average number of common shares - diluted | 11,684 | 11,787 | 11,660 | 11,809 | ||||||||||||
Net income | $ | 27,856 | $ | 23,535 | $ | 51,550 | $ | 32,845 | ||||||||
Other comprehensive income: | ||||||||||||||||
Foreign currency translation adjustment | 5 | 7 | 42 | 18 | ||||||||||||
Comprehensive income | $ | 27,861 | $ | 23,542 | $ | 51,592 | $ | 32,863 | ||||||||
Class A | Class A Common | Class B | Class B | Additional | Accumulated Other | Total | ||||||||||||||||||||||||||
Common | Stock, | Common | Common | Paid-in | Comprehensive | Retained | Stockholders’ | |||||||||||||||||||||||||
Shares | Par | Shares | Stock, Par | Capital | Loss, net of tax | Earnings | Equity | |||||||||||||||||||||||||
Balance at December 29, 2018 | 8,580 | $ | 86 | 2,918 | $ | 29 | $ | 405,711 | $ | (1,197 | ) | $ | 55,688 | $ | 460,317 | |||||||||||||||||
Net income | 23,694 | 23,694 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 54 | — | 3,704 | 3,704 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 2,066 | 2,066 | ||||||||||||||||||||||||||||||
Currency translation adjustment | 37 | 37 | ||||||||||||||||||||||||||||||
Balance at March 30, 2019 | 8,634 | $ | 86 | 2,918 | $ | 29 | $ | 411,481 | $ | (1,160 | ) | $ | 79,382 | $ | 489,818 | |||||||||||||||||
Net income | 27,856 | 27,856 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 21 | 1 | 1,377 | 1,378 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 3,744 | 3,744 | ||||||||||||||||||||||||||||||
Currency translation adjustment | 5 | 5 | ||||||||||||||||||||||||||||||
Balance at June 29, 2019 | 8,655 | $ | 87 | 2,918 | $ | 29 | $ | 416,602 | $ | (1,155 | ) | $ | 107,238 | $ | 522,801 | |||||||||||||||||
Class A | Accumulated | |||||||||||||||||||||||||||||||
Class A | Common | Class B | Class B | Additional | Other | Total | ||||||||||||||||||||||||||
Common | Stock, | Common | Common | Paid-in | Comprehensive | Retained | Stockholders’ | |||||||||||||||||||||||||
Shares | Par | Shares | Stock, Par | Capital | Loss, net of tax | Earnings | Equity | |||||||||||||||||||||||||
Balance at December 30, 2017 | 8,603 | $ | 86 | 3,018 | $ | 30 | $ | 372,590 | $ | (1,288 | ) | $ | 52,105 | $ | 423,523 | |||||||||||||||||
Net income | 9,310 | 9,310 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 188 | 2 | 20,232 | 20,234 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 1,491 | 1,491 | ||||||||||||||||||||||||||||||
Repurchase of Class A Common Stock | (91 | ) | (1 | ) | (16,638 | ) | (16,639 | ) | ||||||||||||||||||||||||
Currency translation adjustment | (11 | ) | (11 | ) | ||||||||||||||||||||||||||||
One time effect of adoption of ASU 2014-09, Revenue from Contracts with Customers, net of tax of $ 329 | (982 | ) | (982 | ) | ||||||||||||||||||||||||||||
One time effect of adoption of ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income | (210 | ) | 210 | — | ||||||||||||||||||||||||||||
Balance at March 31, 2018 | 8,700 | $ | 87 | 3,018 | $ | 30 | $ | 394,313 | $ | (1,509 | ) | $ | 44,005 | $ | 436,926 | |||||||||||||||||
Net income | 23,535 | 23,535 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 32 | — | 2,224 | 2,224 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 3,079 | 3,079 | ||||||||||||||||||||||||||||||
Repurchase of Class A Common Stock | (97 | ) | (1 | ) | (23,084 | ) | (23,085 | ) | ||||||||||||||||||||||||
Currency translation adjustment | (7 | ) | (7 | ) | ||||||||||||||||||||||||||||
Balance at June 30, 2018 | 8,635 | $ | 86 | 3,018 | $ | 30 | $ | 399,616 | $ | (1,516 | ) | $ | 44,456 | $ | 442,672 | |||||||||||||||||
Thirteen weeks ended | Thirty-nine weeks ended | |||||||||||||||
September 28, | September 29, | September 28, | September 29, | |||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenue | $ | 402,691 | $ | 326,852 | $ | 1,008,893 | $ | 818,257 | ||||||||
Less excise taxes | 24,225 | 19,982 | 60,369 | 47,830 | ||||||||||||
Net revenue | 378,466 | 306,870 | 948,524 | 770,427 | ||||||||||||
Cost of goods sold | 190,631 | 149,643 | 477,147 | 375,133 | ||||||||||||
Gross profit | 187,835 | 157,227 | 471,377 | 395,294 | ||||||||||||
Operating expenses: | ||||||||||||||||
Advertising, promotional and selling expenses | 96,570 | 87,765 | 262,372 | 241,796 | ||||||||||||
General and administrative expenses | 31,429 | 22,734 | 81,552 | 65,951 | ||||||||||||
Impairment of assets | — | — | 243 | 517 | ||||||||||||
Total operating expenses | 127,999 | 110,499 | 344,167 | 308,264 | ||||||||||||
Operating income | 59,836 | 46,728 | 127,210 | 87,030 | ||||||||||||
Other income (expense), net: | ||||||||||||||||
Interest (expense) income, net | (138 | ) | 343 | 472 | 821 | |||||||||||
Other income (expense), net | (764 | ) | (51 | ) | (818 | ) | (539 | ) | ||||||||
Total other income (expense), net | (902 | ) | 292 | (346 | ) | 282 | ||||||||||
Income before income tax provision | 58,934 | 47,020 | 126,864 | 87,312 | ||||||||||||
Income tax provision | 14,205 | 9,013 | 30,585 | 16,460 | ||||||||||||
Net income | $ | 44,729 | $ | 38,007 | $ | 96,279 | $ | 70,852 | ||||||||
Net income per common share — basic | $ | 3.70 | $ | 3.25 | $ | 8.16 | $ | 6.02 | ||||||||
Net income per common share — diluted | $ | 3.65 | $ | 3.21 | $ | 8.07 | $ | 5.96 | ||||||||
Weighted-average number of common shares — Class A basic | 9,136 | 8,557 | 8,797 | 8,646 | ||||||||||||
Weighted-average number of common shares — Class B basic | 2,862 | 3,018 | 2,899 | 3,018 | ||||||||||||
Weighted-average number of common shares — diluted | 12,150 | 11,702 | 11,823 | 11,773 | ||||||||||||
Net income | $ | 44,729 | $ | 38,007 | $ | 96,279 | $ | 70,852 | ||||||||
Other comprehensive income: | ||||||||||||||||
Foreign currency translation adjustment | 1 | (13 | ) | 43 | 4 | |||||||||||
Comprehensive income | $ | 44,730 | $ | 37,994 | $ | 96,322 | $ | 70,856 | ||||||||
Class A Common Shares | Class A Common Stock, Par | Class B Common Shares | Class B Common Stock, Par | Additional Paid-in Capital | Accumulated Other Comprehensive Loss, net of tax | Retained Earnings | Total Stockholders’ Equity | |||||||||||||||||||||||||
Balance at December 29, 2018 | 8,580 | $ | 86 | 2,918 | $ | 29 | $ | 405,711 | $ | (1,197 | ) | $ | 55,688 | $ | 460,317 | |||||||||||||||||
Net income | 23,694 | 23,694 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 54 | — | 3,704 | 3,704 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 2,066 | 2,066 | ||||||||||||||||||||||||||||||
Currency translation adjustment | 37 | 37 | ||||||||||||||||||||||||||||||
Balance at March 30, 2019 | 8,634 | $ | 86 | 2,918 | $ | 29 | $ | 411,481 | $ | (1,160 | ) | $ | 79,382 | $ | 489,818 | |||||||||||||||||
Net income | 27,856 | 27,856 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 21 | 1 | 1,377 | 1,378 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 3,744 | 3,744 | ||||||||||||||||||||||||||||||
Currency translation adjustment | 5 | 5 | ||||||||||||||||||||||||||||||
Balance at June 29, 2019 | 8,655 | $ | 87 | 2,918 | $ | 29 | $ | 416,602 | $ | (1,155 | ) | $ | 107,238 | $ | 522,801 | |||||||||||||||||
Net income | 44,729 | 44,729 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 31 | — | 3,473 | 3,473 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 3,233 | 3,233 | ||||||||||||||||||||||||||||||
Shares issued in connection with Dogfish Head merger | 430 | 4 | 144,739 | 144,743 | ||||||||||||||||||||||||||||
Conversion from Class B to Class A | 100 | 1 | (100 | ) | (1 | ) | — | |||||||||||||||||||||||||
Currency translation adjustment | 1 | 1 | ||||||||||||||||||||||||||||||
Balance at September 28, 2019 | 9,216 | $ | 92 | 2,818 | $ | 28 | $ | 568,047 | $ | (1,154 | ) | $ | 151,967 | $ | 718,980 | |||||||||||||||||
Class A Common Shares | Class A Common Stock, Par | Class B Common Shares | Class B Common Stock, Par | Additional Paid-in Capital | Accumulated Other Comprehensive Loss, net of tax | Retained Earnings | Total Stockholders’ Equity | |||||||||||||||||||||||||
Balance at December 30, 2017 | 8,603 | $ | 86 | 3,018 | $ | 30 | $ | 372,590 | $ | (1,288 | ) | $ | 52,105 | $ | 423,523 | |||||||||||||||||
Net income | 9,310 | 9,310 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 188 | 2 | 20,232 | 20,234 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 1,491 | 1,491 | ||||||||||||||||||||||||||||||
Repurchase of Class A Common Stock | (91 | ) | (1 | ) | (16,638 | ) | (16,639 | ) | ||||||||||||||||||||||||
Currency translation adjustment | (11 | ) | (11 | ) | ||||||||||||||||||||||||||||
One time effect of adoption of ASU 2014-09, Revenue from Contracts with Customers, net of tax of $329 | (982 | ) | (982 | ) | ||||||||||||||||||||||||||||
One time effect of adoption of ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income | (210 | ) | 210 | — | ||||||||||||||||||||||||||||
Balance at March 31, 2018 | 8,700 | $ | 87 | 3,018 | $ | 30 | $ | 394,313 | $ | (1,509 | ) | $ | 44,005 | $ | 436,926 | |||||||||||||||||
Net income | 23,535 | 23,535 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 32 | — | 2,224 | 2,224 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 3,079 | 3,079 | ||||||||||||||||||||||||||||||
Repurchase of Class A Common Stock | (97 | ) | (1 | ) | (23,084 | ) | (23,085 | ) | ||||||||||||||||||||||||
Currency translation adjustment | (7 | ) | (7 | ) | ||||||||||||||||||||||||||||
Balance at June 30, 2018 | 8,635 | $ | 86 | 3,018 | $ | 30 | $ | 399,616 | $ | (1,516 | ) | $ | 44,456 | $ | 442,672 | |||||||||||||||||
Net income | 38,007 | 38,007 | ||||||||||||||||||||||||||||||
Stock options exercised and restricted shares activities | 2 | — | 15 | 15 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 2,425 | 2,425 | ||||||||||||||||||||||||||||||
Repurchase of Class A Common Stock | (162 | ) | (1 | ) | (48,585 | ) | (48,586 | ) | ||||||||||||||||||||||||
Currency translation adjustment | 13 | 13 | ||||||||||||||||||||||||||||||
Balance at September 29, 2018 | 8,475 | $ | 85 | 3,018 | $ | 30 | $ | 402,056 | $ | (1,503 | ) | $ | 33,878 | $ | 434,546 | |||||||||||||||||
Twenty-six weeks ended | ||||||||
June 29, 2019 | June 30, 2018 | |||||||
Cash flows provided by operating activities: | ||||||||
Net income | $ | 51,550 | $ | 32,845 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 26,089 | 26,011 | ||||||
Impairment of assets | 243 | 517 | ||||||
Loss on disposal of property, plant and equipment | 104 | 26 | ||||||
Lease expense | 1,789 | — | ||||||
Bad debt (recovery) expense | (1 | ) | 27 | |||||
Stock-based compensation expense | 5,810 | 4,570 | ||||||
Deferred income taxes | 6,283 | 775 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (35,346 | ) | (21,651 | ) | ||||
Inventories | (14,942 | ) | (18,636 | ) | ||||
Prepaid expenses, income tax receivable and other assets | (10,962 | ) | 217 | |||||
Accounts payable | 26,320 | 20,563 | ||||||
Accrued expenses and other current liabilities | (101 | ) | 8,721 | |||||
Net lease liabilities | (1,391 | ) | — | |||||
Other liabilities | 85 | (244 | ) | |||||
Net cash provided by operating activities | 55,530 | 53,741 | ||||||
Cash flows used in investing activities: | ||||||||
Purchases of property, plant and equipment | (44,578 | ) | (25,470 | ) | ||||
Proceeds from disposal of property, plant and equipment | 179 | 2 | ||||||
Cash paid for merger | (158,402) | — | ||||||
Change in restricted cash | (188 | ) | 98 | |||||
Net cash used in investing activities | (202,989 | ) | (25,370 | ) | ||||
Cash flows provided by (used in) financing activities: | ||||||||
Repurchase of Class A Common Stock | — | (39,725 | ) | |||||
Proceeds from exercise of stock options | 4,146 | 21,529 | ||||||
Net cash paid on note payable and capital lease | (115 | ) | (78 | ) | ||||
Cash borrowed on line of credit | 86,000 | — | ||||||
Cash paid on line of credit | (48,500 | ) | — | |||||
Net proceeds from sale of investment shares | 546 | 445 | ||||||
Net cash provided (used in) by financing activities | 42,077 | (17,829 | ) | |||||
Change in cash and cash equivalents | (105,382 | ) | 10,542 | |||||
Cash and cash equivalents at beginning of year | 108,399 | 65,637 | ||||||
Cash and cash equivalents at end of period | $ | 3,017 | $ | 76,179 | ||||
Supplemental disclosure of cash flow information: | ||||||||
Income taxes paid | $ | 13,697 | $ | 3,355 | ||||
Cash paid for amounts included in measurement of lease liabilities | $ | 1,976 | $ | — | ||||
Right-of-use assets obtained in exchange for operating lease obligations | $ | 38,524 | $ | — | ||||
Right-of-use assets obtained in exchange for capital lease obligations | $ | 2,837 | $ | — | ||||
Decrease in accounts receivable for ASU 2014-09 adoption | $ | — | $ | (1,310 | ) | |||
Increase in accounts payable for purchase of property, plant and equipment | $ | 1,484 | $ | 774 |
Thirty-nine weeks ended | ||||||||
September 28, 2019 | September 29, 2018 | |||||||
Cash flows provided by operating activities: | ||||||||
Net income | $ | 96,279 | $ | 70,852 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 41,841 | 38,860 | ||||||
Impairment of assets | 243 | 517 | ||||||
Loss on disposal of property, plant and equipment | 449 | 45 | ||||||
Change in ROU assets | 2,734 | — | ||||||
Bad debt (recovery) expense | 53 | 39 | ||||||
Stock-based compensation expense | 9,043 | 6,995 | ||||||
Deferred income taxes | 14,047 | 12,818 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (26,532 | ) | (20,412 | ) | ||||
Inventories | (16,847 | ) | (20,836 | ) | ||||
Prepaid expenses, income tax receivable and other assets | (13,903 | ) | (8,385 | ) | ||||
Accounts payable | 22,388 | 20,560 | ||||||
Accrued expenses and other current liabilities | 14,949 | 6,309 | ||||||
Change in operating lease liability | (2,270 | ) | — | |||||
Other liabilities | 207 | 693 | ||||||
Net cash provided by operating activities | 142,681 | 108,055 | ||||||
Cash flows used in investing activities: | ||||||||
Purchases of property, plant and equipment | (66,760 | ) | (38,752 | ) | ||||
Proceeds from disposal of property, plant and equipment | 144 | 2 | ||||||
Cash paid for acquisition of intangible assets | — | 5 | ||||||
Investment in Dogfish Head, net of cash acquired | (165,517 | ) | — | |||||
Other investing activities | (10 | ) | 131 | |||||
Net cash used in investing activities | (232,143 | ) | (38,614 | ) | ||||
Cash flows provided by (used in) financing activities: | ||||||||
Repurchase of Class A Common Stock | — | (88,311 | ) | |||||
Proceeds from exercise of stock options | 7,619 | 21,528 | ||||||
Net cash paid on note payable and capital lease | (246 | ) | (78 | ) | ||||
Cash borrowed on line of credit | 97,000 | — | ||||||
Cash paid on line of credit | (97,000 | ) | — | |||||
Net proceeds from sale of investment shares | 818 | 670 | ||||||
Net cash provided (used in) by financing activities | 8,191 | (66,191 | ) | |||||
Change in cash and cash equivalents | (81,271 | ) | 3,250 | |||||
Cash and cash equivalents at beginning of year | 108,399 | 65,637 | ||||||
Cash and cash equivalents at end of period | $ | 27,128 | $ | 68,887 | ||||
Supplemental disclosure of cash flow information: | ||||||||
Non cash consideration issued in Dogfish Head Transaction (Refer to Note B) | $ | 144,743 | $ | — | ||||
Income taxes paid | $ | 16,759 | $ | 11,252 | ||||
Cash paid for amounts included in measurement of lease liabilities | $ | 3,443 | $ | — | ||||
Right-of-use assets obtained in exchange for operating lease obligations | $ | 41,678 | $ | — | ||||
Right-of-use assets obtained in exchange for capital lease obligations | $ | 2,837 | $ | — | ||||
Interest paid on revolving credit facility | $ | 349 | $ | — | ||||
Decrease in accounts receivable for ASU 2014-09 adoption | $ | — | $ | (1,310 | ) | |||
Decrease in accounts payable for purchase of property, plant and equipment | $ | (2,076 | ) | $ | 3,346 | |||
A. | Organization and Basis of Presentation |
B. | Dogfish Head Brewery |
Total (In Thousands) | ||||
Cash and cash equivalents | $ | 7,476 | ||
Accounts receivable | 8,081 | |||
Inventories | 9,286 | |||
Prepaid expenses and other current assets | 847 | |||
Property, plant and equipment | 106,964 | |||
Goodwill | 108,846 | |||
Brand | 98,500 | |||
Other intangible assets | 3,800 | |||
Other assets | 378 | |||
Total assets acquired | 344,178 | |||
Accounts payable | 3,861 | |||
Accrued expenses and other current liabilities | 4,085 | |||
Deferred income taxes | 18,437 | |||
Other liabilities | 59 | |||
Total liabilities assumed | 26,442 | |||
Net assets acquired | $ | 317,736 | ||
Cash consideration | $ | 172,993 | ||
Nominal value of equity issued | 162,999 | |||
Fair Value reduction due to liquidity | (18,256 | ) | ||
Estimated total purchase price | $ | 317,736 | ||
(i) | Depreciation and amortization expenses were updated to reflect the fair value adjustments to Dogfish Head property, plant and equipment and intangible assets beginning December 31, 2017. |
Transaction costs incurred in the thirteen and thirty-nine weeks ended September 28, 2019 have been re-assigned to the first period of the comparative fiscal year. |
(iii) | Interest expense has been included at a rate of approximately 3% which is consistent with the borrowing rate on the Company’s current line of credit. |
(iv) | The tax effects of the pro forma adjustments at an estimated statutory rate of 25.6%. |
(v) | Earnings per share amounts are calculated using the Company’s historical weighted average shares outstanding plus the 429,291 shares issued in the merger. |
Thirteen weeks ended | Thirty-nine weeks ended | |||||||||||||||
September 28, 2019 | September 29, 2018 | September 28, 2019 | September 29, 2018 | |||||||||||||
Net revenue | $ | 379,205 | $ | 335,954 | $ | 1,002,939 | $ | 852,611 | ||||||||
Net income | $ | 46,445 | $ | 42,638 | $ | 103,105 | $ | 77,541 | ||||||||
Basic earnings per share | $ | 3.84 | $ | 3.51 | $ | 8.74 | $ | 6.36 | ||||||||
Diluted earnings per share | $ | 3.79 | $ | 3.48 | $ | 8.64 | $ | 6.30 |
C. | Goodwill and Intangible Assets |
Thirty-nine weeks ended | ||||||||
September 28, | September 29, | |||||||
2019 | 2018 | |||||||
Goodwill as of beginning of period | $ | 3,683 | $ | 3,683 | ||||
Acquired goodwill | 108,846 | — | ||||||
Impairment of goodwill | — | — | ||||||
Goodwill as of end of period | $ | 112,529 | $ | 3,683 | ||||
As of September 28, 2019 | As of December 29, 2018 | |||||||||||||||||||||||||||
Estimated Useful | Gross Carrying | Accumulated | Net Book | Gross Carrying | Accumulated | Net Book | ||||||||||||||||||||||
Life (Years) | Value | Amortization | Value | Value | Amortization | Value | ||||||||||||||||||||||
Custmer Relationships | 15 | $ | 3,800 | $ | (64 | ) | $ | 3,736 | $ | — | $ | — | $ | — | ||||||||||||||
Trade Names | Indefinite | 100,599 | — | 100,599 | 2,099 | — | 2,099 | |||||||||||||||||||||
Total intangible assets | $ | 104,399 | $ | (64 | ) | $ | 104,335 | $ | 2,099 | $ | — | $ | 2,099 | |||||||||||||||
Fiscal Year | Amount | |||
Remainder of 2019 | $ | 63 | ||
2020 | 253 | |||
2021 | 253 | |||
2022 | 253 | |||
2023 | 253 | |||
2024 | 253 |
D. | Recent Accounting Pronouncements |
E. | Revenue Recognition |
F. | Inventories |
June 29, | December 29, | |||||||||||||||
2019 | 2018 | September 28, 2019 | December 29, 2018 | |||||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Current inventory: | ||||||||||||||||
Raw materials | $ | 46,194 | $ | 44,655 | $ | 51,322 | $ | 44,655 | ||||||||
Work in process | 10,191 | 8,252 | 13,270 | 8,252 | ||||||||||||
Finished goods | 23,976 | 17,342 | 28,040 | 17,342 | ||||||||||||
Total current inventory | 80,361 | 70,249 | 92,632 | 70,249 | ||||||||||||
Long term inventory | 16,449 | 11,619 | 15,369 | 11,619 | ||||||||||||
Total inventory | $ | 96,810 | $ | 81,868 | $ | 108,001 | $ | 81,868 | ||||||||
G. | Leases |
Classification | Leases | |||||
Right-of-use assets | (in thousands) | |||||
Operating lease assets | Operating right-of-use assets | $ | 38,943 | |||
Capital lease assets | Property, plant and equipment, net | 2,663 | ||||
Lease Liabilities | ||||||
Current | ||||||
Operating lease liabilities | Current operating lease liabilities | 2,599 | ||||
Capital lease liabilities | Accrued expenses and other current l iabilities | 541 | ||||
Non-current | ||||||
Operating lease liabilities | Non-current operating lease liabilities | 41,215 | ||||
Capital lease liabilities | Other liabilities | 2,178 |
Operating Leases | Capital Leases | Weighted-Average Remaining Term in Years | ||||||||||||||
Operating Leases | Capital Leases | |||||||||||||||
(in thousands) | ||||||||||||||||
2019 | $ | 2,557 | $ | 309 | ||||||||||||
2020 | 2,268 | 626 | ||||||||||||||
2021 | 5,379 | 626 | ||||||||||||||
2022 | 5,083 | 627 | ||||||||||||||
2023 | 4,965 | 627 | ||||||||||||||
After 2023 | 30,100 | 288 | ||||||||||||||
Total lease payments | 50,352 | 3,103 | ||||||||||||||
Less imputed interest (based on 3.5% weighted- average discount rate) | (8,798 | ) | (253 | ) | ||||||||||||
Present value of lease liability | $ | 41,554 | $ | 2,850 | 10.1 | 4.97 | ||||||||||
Operating | Capital | Weighted-Average Remaining Term in Years | ||||||||||||||
Leases | Leases | Operating Leases | Capital Leases | |||||||||||||
(in thousands) | ||||||||||||||||
2019 | $ | 1,466 | $ | 155 | ||||||||||||
2020 | 2,642 | 626 | ||||||||||||||
2021 | 5,754 | 626 | ||||||||||||||
2022 | 5,453 | 626 | ||||||||||||||
2023 | 5,313 | 626 | ||||||||||||||
After 2023 | 32,191 | 288 | ||||||||||||||
Total lease payments | 52,819 | 2,947 | ||||||||||||||
Less imputed interest (based on 3.5% weighted-average discount rate) | (9,005 | ) | (228 | ) | ||||||||||||
Present value of lease liability | $ | 43,814 | $ | 2,719 | 4.7 | 9.9 |
Leases | ||||
(in thousands) | ||||
2019 | $ | 4,446 | ||
2020 | 4,530 | |||
2021 | 4,370 | |||
2022 | 3,559 | |||
2023 | 1,672 | |||
Thereafter | 7,582 | |||
Total | $ | 26,159 | ||
H. | Net Income per Share |
Thirteen weeks ended | Twenty-six weeks ended | Thirteen weeks ended | Thirty-nine weeks ended | |||||||||||||||||||||||||||||
June 29, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | September 28, 2019 | September 29, 2018 | September 28, 2019 | September 29, 2018 | |||||||||||||||||||||||||
(in thousands, except per share data) | (in thousands, except per share data) | (in thousands, except per share data) | (in thousands, except per share data) | |||||||||||||||||||||||||||||
Net income | $ | 27,856 | $ | 23,535 | $ | 51,550 | $ | 32,845 | $ | 44,729 | $ | 38,007 | $ | 96,279 | $ | 70,852 | ||||||||||||||||
Allocation of net income for basic: | ||||||||||||||||||||||||||||||||
Class A Common Stock | $ | 20,639 | $ | 17,290 | $ | 38,161 | $ | 24,187 | $ | 33,776 | $ | 27,786 | $ | 71,761 | $ | 52,051 | ||||||||||||||||
Class B Common Stock | 6,964 | 6,020 | 12,908 | 8,400 | 10,581 | 9,800 | 23,652 | 18,169 | ||||||||||||||||||||||||
Unvested participating shares | 253 | 225 | 481 | 258 | 372 | 421 | 866 | 632 | ||||||||||||||||||||||||
$ | 27,856 | $ | 23,535 | $ | 51,550 | $ | 32,845 | $ | 44,729 | $ | 38,007 | $ | 96,279 | $ | 70,852 | |||||||||||||||||
Weighted average number of shares for basic: | ||||||||||||||||||||||||||||||||
Class A Common Stock | 8,648 | 8,667 | 8,627 | 8,690 | 9,136 | 8,557 | 8,797 | 8,646 | ||||||||||||||||||||||||
Class B Common Stock* | 2,918 | 3,018 | 2,918 | 3,018 | 2,862 | 3,018 | 2,899 | 3,018 | ||||||||||||||||||||||||
Unvested participating shares | 106 | 112 | 109 | 93 | 101 | 130 | 106 | 105 | ||||||||||||||||||||||||
11,672 | 11,797 | 11,654 | 11,801 | |||||||||||||||||||||||||||||
12,099 | 11,705 | 11,802 | 11,769 | |||||||||||||||||||||||||||||
Net income per share for basic: | ||||||||||||||||||||||||||||||||
Class A Common Stock | $ | 2.39 | $ | 1.99 | $ | 4.42 | $ | 2.78 | $ | 3.70 | $ | 3.25 | $ | 8.16 | $ | 6.02 | ||||||||||||||||
Class B Common Stock | $ | 2.39 | $ | 1.99 | $ | 4.42 | $ | 2.78 | $ | 3.70 | $ | 3.25 | $ | 8.16 | $ | 6.02 | ||||||||||||||||
* | Change in Class B Common Stock resulted from the conversion of 100,000 shares to Class A Common Stock on November 1, 2018 and100,000 shares to Class A Common stock on August 8, 2019 with the ending number of shares reflecting the weighted average for the period. |
Thirteen weeks ended | Thirteen weeks ended | |||||||||||||||||||||||||||||||||||||||||||||||
June 29, 2019 | June 30, 2018 | September 28, 2019 | September 29, 2018 | |||||||||||||||||||||||||||||||||||||||||||||
Earnings to Common Shareholders | Common Shares | EPS | Earnings to Common Shareholders | Common Shares | EPS | Earnings to Common Shareholders | Common Shares | EPS | Earnings to Common Shareholders | Common Shares | EPS | |||||||||||||||||||||||||||||||||||||
(in thousands, except per share data) | (in thousands, except per share data) | |||||||||||||||||||||||||||||||||||||||||||||||
As reported - basic | $ | 20,639 | 8,648 | $ | 2.39 | $ | 17,290 | 8,667 | $ | 1.99 | ||||||||||||||||||||||||||||||||||||||
As reported — basic | $ | 33,776 | 9,136 | $ | 3.70 | $ | 27,786 | 8,557 | $ | 3.25 | ||||||||||||||||||||||||||||||||||||||
Add: effect of dilutive potential common shares | ||||||||||||||||||||||||||||||||||||||||||||||||
Share-based awards | — | 118 | — | 102 | — | 152 | — | 127 | ||||||||||||||||||||||||||||||||||||||||
Class B Common Stock | 6,964 | 2,918 | 6,020 | 3,018 | 10,581 | 2,862 | 9,800 | 3,018 | ||||||||||||||||||||||||||||||||||||||||
Net effect of unvested participating shares | 2 | — | 2 | — | 4 | — | 5 | — | ||||||||||||||||||||||||||||||||||||||||
Net income per common share - diluted | $ | 27,605 | 11,684 | $ | 2.36 | $ | 23,312 | 11,787 | $ | 1.98 | ||||||||||||||||||||||||||||||||||||||
Net income per common share — diluted | $ | 44,361 | 12,150 | $ | 3.65 | $ | 37,591 | 11,702 | $ | 3.21 | ||||||||||||||||||||||||||||||||||||||
Twenty-six weeks ended | ||||||||||||||||||||||||||||||||||||||||||||||||
June 29, 2019 | June 30, 2018 | Thirty-nine weeks ended | ||||||||||||||||||||||||||||||||||||||||||||||
Earnings to Common Shareholders | Common Shares | EPS | Earnings to Common Shareholders | Common Shares | EPS | September 28, 2019 | September 29, 2018 | |||||||||||||||||||||||||||||||||||||||||
(in thousands, except per share data) | Earnings to Common Shareholders | Common Shares | EPS | Earnings to Common Shareholders | Common Shares | EPS | ||||||||||||||||||||||||||||||||||||||||||
As reported - basic | $ | 38,161 | 8,627 | $ | 4.42 | $ | 24,187 | 8,690 | $ | 2.78 | ||||||||||||||||||||||||||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||||||||||||||||||||||||||||||
As reported — basic | $ | 71,761 | 8,797 | $ | 8.16 | $ | 52,051 | 8,646 | $ | 6.02 | ||||||||||||||||||||||||||||||||||||||
Add: effect of dilutive potential common shares | ||||||||||||||||||||||||||||||||||||||||||||||||
Share-based awards | — | 115 | — | 101 | — | 127 | — | 109 | ||||||||||||||||||||||||||||||||||||||||
Class B Common Stock | 12,908 | 2,918 | 8,400 | 3,018 | 23,652 | 2,899 | 18,169 | 3,018 | ||||||||||||||||||||||||||||||||||||||||
Net effect of unvested participating shares | 5 | — | 2 | — | 8 | — | 5 | — | ||||||||||||||||||||||||||||||||||||||||
Net income per common share - diluted | $ | 51,074 | 11,660 | $ | 4.38 | $ | 32,589 | 11,809 | $ | 2.76 | ||||||||||||||||||||||||||||||||||||||
Net income per common share — diluted | $ | 95,421 | 11,823 | $ | 8.07 | $ | 70,225 | 11,773 | $ | 5.96 |
I. | Comprehensive Income or Loss |
J. | Commitments and Contingencies |
K. | Income Taxes |
Thirteen weeks ended | ||||||||
June 29, 2019 | June 30, 2018 | |||||||
(in thousands) | ||||||||
Summary of income tax provision | ||||||||
Tax provision based on net income | $ | 10,499 | $ | 8,727 | ||||
Benefit of ASU 2016-09 | (253 | ) | (1,128 | ) | ||||
Total income tax provision | $ | 10,246 | $ | 7,599 | ||||
Twenty-six weeks ended | ||||||||
June 29, 2019 | June 30, 2018 | |||||||
(in thousands) | ||||||||
Summary of income tax provision | ||||||||
Tax provision based on net income | $ | 18,408 | $ | 11,298 | ||||
Benefit of ASU 2016-09 | (2,028 | ) | (3,851 | ) | ||||
Total income tax provision | $ | 16,380 | $ | 7,447 |
Thirteen weeks ended | ||||||||
September 28, | September 29, | |||||||
2019 | 2018 | |||||||
(in thousands) | ||||||||
Summary of income tax provision | ||||||||
Tax provision based on net income | $ | 16,047 | $ | 13,671 | ||||
Accounting Method Changes | — | (4,529 | ) | |||||
Benefit of ASU 2016-09 | (1,842 | ) | (129 | ) | ||||
Total income tax provision | $ | 14,205 | $ | 9,013 | ||||
Thirty-nine weeks ended | ||||||||
September 28, | September 29, | |||||||
2019 | 2018 | |||||||
(in thousands) | ||||||||
Summary of income tax provision | ||||||||
Tax provision based on net income | $ | 34,455 | $ | 24,969 | ||||
Accounting Method Changes | — | (4,529 | ) | |||||
Benefit of ASU 2016-09 | (3,870 | ) | (3,980 | ) | ||||
Total income tax provision | $ | 30,585 | $ | 16,460 |
L. | Revolving Line of Credit |
M. | Fair Value Measures |
N. | Common Stock and Stock-Based Compensation |
Shares | Weighted-Average Exercise Price | Weighted-Average RemainingContractual Term in Years | Aggregate Intrinsic Value (in thousands) | Shares | Weighted-Average Exercise Price | Weighted-Average RemainingContractual Term in Years | Aggregate Intrinsic Value (in thousands) | |||||||||||||||||||||||||
Outstanding at December 29, 2018 | 366,829 | $ | 155.75 | 366,829 | $ | 155.75 | ||||||||||||||||||||||||||
Granted | 31,286 | 313.56 | 31,286 | 313.56 | ||||||||||||||||||||||||||||
Forfeited | — | — | — | — | ||||||||||||||||||||||||||||
Expired | — | — | — | — | ||||||||||||||||||||||||||||
Exercised | (43,866 | ) | 94.50 | (72,937 | ) | 104.47 | ||||||||||||||||||||||||||
Outstanding at June 29, 2019 | 354,249 | $ | 177.28 | 5.64 | $ | 71,021 | ||||||||||||||||||||||||||
Outstanding at September 28, 2019 | 325,178 | $ | 182.44 | 5.83 | $ | 55,196 | ||||||||||||||||||||||||||
Exercisable at June 29, 2019 | 131,684 | $ | 134.82 | 3.42 | $ | 31,991 | ||||||||||||||||||||||||||
Vested and expected to vest at June 29, 2019 | 325,498 | $ | 175.05 | 5.53 | $ | 65,983 | ||||||||||||||||||||||||||
Exercisable at September 28, 2019 | 102,613 | $ | 139.16 | 3.96 | $ | 21,859 | ||||||||||||||||||||||||||
Vested and expected to vest at September 28, 2019 | 300,886 | $ | 180.81 | 5.76 | $ | 51,563 | ||||||||||||||||||||||||||
Number of Shares | Weighted Average Fair Value | |||||||
Non-vested at December 29, 2018 | 126,720 | $ | 192.74 | |||||
Granted | 29,504 | $ | 266.54 | |||||
Vested | (31,496 | ) | $ | 187.25 | ||||
Forfeited | (1,110 | ) | $ | 144.92 | ||||
Non-vested at June 29, 2019 | 123,618 | $ | 212.18 |
Number of Shares | Weighted Average Fair Value | |||||||
Non-vested at December 29, 2018 | 126,720 | $ | 192.74 | |||||
Granted | 30,410 | $ | 269.91 | |||||
Vested | (33,201 | ) | $ | 188.63 | ||||
Forfeited | (1,550 | ) | $ | 142.00 | ||||
Non-vested at September 28, 2019 | 122,379 | $ | 213.67 | |||||
O. | Employee Retirement Plans |
P. | Related Party Transactions |
Q. | Subsequent Events |
Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Thirteen Weeks Ended (in thousands) | Thirteen Weeks Ended (in thousands, except per barrel) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
June 29, 2019 | June 30, 2018 | Amount change | % change | Per barrel change | September 28, 2019 | September 29, 2018 | Amount change | % change | Per barrel change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Barrels sold | 1,374 | 1,177 | 198 | 16.8 | % | 1,594 | 1,338 | 255 | 19.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Per barrel | % of net revenue | Per barrel | % of net revenue | Per barrel | % of net revenue | Per barrel | % of net revenue | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net revenue | $ | 318,407 | $ | 231.68 | 100.0 | % | $ | 273,100 | $ | 232.09 | 100.0 | % | $ | 45,307 | 16.6 | % | $ | (0.41 | ) | $ | 378,466 | $ | 237.46 | 100.0 | % | $ | 306,870 | $ | 229.27 | 100.0 | % | $ | 71,596 | 23.3 | % | $ | 8.19 | |||||||||||||||||||||||||||||||||||
Cost of goods | 159,405 | 115.99 | 50.1 | % | 131,130 | 111.44 | 48.0 | % | 28,275 | 21.6 | % | 4.55 | 190,631 | 119.61 | 50.4 | % | 149,643 | 111.80 | 48.8 | % | 40,988 | 27.4 | % | 7.81 | ||||||||||||||||||||||||||||||||||||||||||||||||
Gross profit | 159,002 | 115.69 | 49.9 | % | 141,970 | 120.65 | 52.0 | % | 17,032 | 12.0 | % | (4.96 | ) | 187,835 | 117.85 | 49.6 | % | 157,227 | 117.47 | 51.2 | % | 30,608 | 19.5 | % | 0.38 | |||||||||||||||||||||||||||||||||||||||||||||||
Advertising, promotional and selling expenses | 94,079 | 68.45 | 29.5 | % | 86,510 | 73.52 | 31.7 | % | 7,569 | 8.7 | % | (5.07 | ) | 96,570 | 60.59 | 25.5 | % | 87,765 | 65.57 | 28.6 | % | 8,805 | 10.0 | % | (4.98 | ) | ||||||||||||||||||||||||||||||||||||||||||||||
General and administrative expenses | 26,748 | 19.46 | 8.4 | % | 23,879 | 20.29 | 8.7 | % | 2,869 | 12.0 | % | (0.83 | ) | 31,429 | 19.72 | 8.3 | % | 22,734 | 16.99 | 7.4 | % | 8,695 | 38.2 | % | 2.73 | |||||||||||||||||||||||||||||||||||||||||||||||
Impairment of assets | 243 | 0.18 | 0.1 | % | 517 | 0.44 | 0.2 | % | (274 | ) | 0.0 | % | (0.26 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
�� | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 121,070 | 88.09 | 38.0 | % | 110,906 | 94.25 | 40.6 | % | 10,164 | 9.2 | % | (6.16 | ) | 127,999 | 80.31 | 33.8 | % | 110,499 | 82.56 | 36.0 | % | 17,500 | 15.8 | % | (2.25 | ) | ||||||||||||||||||||||||||||||||||||||||||||||
Operating income | 37,932 | 27.60 | 11.9 | % | 31,064 | 26.40 | 11.4 | % | 6,868 | 22.1 | % | 1.20 | 59,836 | 37.54 | 15.8 | % | 46,728 | 34.91 | 15.2 | % | 13,108 | 28.1 | % | 2.63 | ||||||||||||||||||||||||||||||||||||||||||||||||
Other income | 170 | 0.12 | 0.1 | % | 70 | 0.06 | 0.0 | % | 100 | 142.9 | % | 0.06 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other (expense) income | (902 | ) | (0.57 | ) | -0.2 | % | 292 | 0.22 | 0.1 | % | (1,194 | ) | -408.9 | % | (0.79 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income before income tax expense | 38,102 | 27.72 | 12.0 | % | 31,134 | 26.46 | 11.4 | % | 6,968 | 22.4 | % | 1.26 | 58,934 | 36.98 | 15.6 | % | 47,020 | 35.13 | 15.3 | % | 11,914 | 25.3 | % | 1.85 | ||||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | 10,246 | 7.46 | 3.2 | % | 7,599 | 6.46 | 2.8 | % | 2,647 | 34.8 | % | 1.00 | 14,205 | 8.91 | 3.8 | % | 9,013 | 6.73 | 2.9 | % | 5,192 | 57.6 | % | 2.18 | ||||||||||||||||||||||||||||||||||||||||||||||||
Net income | $ | 27,856 | $ | 20.27 | 8.7 | % | $ | 23,535 | $ | 20.00 | 8.6 | % | $ | 4,321 | 18.4 | % | $ | 0.27 | $ | 44,729 | $ | 28.06 | 11.8 | % | $ | 38,007 | $ | 28.40 | 12.4 | % | $ | 6,722 | 17.7 | % | $ | (0.34 | ) | |||||||||||||||||||||||||||||||||||
Twenty-six Weeks Ended(in thousands) | ||||||||||||||||||||||||||||||||||||
June 29, 2019 | June 30, 2018 | Amount change | % change | Per barrel change | ||||||||||||||||||||||||||||||||
Barrels sold | 2,451 | 1,989 | 462 | 23.2 | % | |||||||||||||||||||||||||||||||
Per barrel | % of net revenue | Per barrel | % of net revenue | |||||||||||||||||||||||||||||||||
Net revenue | $ | 570,058 | $ | 232.60 | 100.0 | % | $ | 463,557 | $ | 233.02 | 100.0 | % | $ | 106,501 | 23.0 | % | $ | (0.42) | ||||||||||||||||||
Cost of goods | 286,516 | 116.90 | 50.3 | % | 225,490 | 113.35 | 48.6 | % | 61,026 | 27.1 | % | 3.55 | ||||||||||||||||||||||||
Gross profit | 283,542 | 115.69 | 49.7 | % | 238,067 | 119.67 | 51.4 | % | 45,475 | 19.1 | % | (3.98) | ||||||||||||||||||||||||
Advertising, promotional and selling expenses | 165,802 | 67.65 | 29.1 | % | 154,031 | 77.43 | 33.2 | % | 11,771 | 7.6 | % | (9.78) | ||||||||||||||||||||||||
General and administrative expenses | 50,122 | 20.45 | 8.8 | % | 43,217 | 21.72 | 9.3 | % | 6,905 | 16.0 | % | (1.27) | ||||||||||||||||||||||||
Impairment of assets | 243 | 0.10 | 0.0 | % | 517 | 0.26 | 0.1 | % | (274) | -53.0 | % | (0.16) | ||||||||||||||||||||||||
Total operating expenses | 216,167 | 88.20 | 37.9 | % | 197,765 | 99.41 | 42.7 | % | 18,402 | 9.3 | % | (11.21) | ||||||||||||||||||||||||
Operating income | 67,375 | 27.49 | 11.8 | % | 40,302 | 20.26 | 8.7 | % | 27,073 | 67.2 | % | 7.23 | ||||||||||||||||||||||||
Other income (expense), net | 555 | 0.23 | 0.1 | % | (10) | (0.01) | 0.0 | % | 565 | -5650.0 | % | 0.24 | ||||||||||||||||||||||||
Income before income tax expense | 67,930 | 27.72 | 11.9 | % | 40,292 | 20.25 | 8.7 | % | 27,638 | 68.6 | % | 7.47 | ||||||||||||||||||||||||
Income tax expense | 16,380 | 6.68 | 2.9 | % | 7,447 | 3.74 | 1.6 | % | 8,933 | 120.0 | % | 2.94 | ||||||||||||||||||||||||
Net income | $ | 51,550 | $ | 21.03 | 9.0 | % | $ | 32,845 | $ | 16.51 | 7.1 | % | $ | 18,705 | 56.9 | % | $ | 4.52 | ||||||||||||||||||
Thirty-nine Weeks Ended (in thousands, except per barrel) | Amount change | % change | Per barrel change | |||||||||||||||||||||||||||||||||
September 28, 2019 | September 29, 2018 | |||||||||||||||||||||||||||||||||||
Barrels sold | 4,045 | 3,328 | 717 | 21.5 | % | |||||||||||||||||||||||||||||||
Per barrel | % of net revenue | Per barrel | % of net revenue | |||||||||||||||||||||||||||||||||
Net revenue | $ | 948,524 | $ | 234.51 | 100.0 | % | $ | 770,427 | $ | 231.51 | 100.0 | % | $ | 178,097 | 23.1 | % | $ | 3.00 | ||||||||||||||||||
Cost of goods | 477,147 | 117.97 | 50.3 | % | 375,133 | 112.73 | 48.7 | % | 102,014 | 27.2 | % | 5.24 | ||||||||||||||||||||||||
Gross profit | 471,377 | 116.54 | 49.7 | % | 395,294 | 118.79 | 51.3 | % | 76,083 | 19.2 | % | (2.25 | ) | |||||||||||||||||||||||
Advertising, promotional and selling expenses | 262,372 | 64.87 | 27.7 | % | 241,796 | 72.66 | 31.4 | % | 20,576 | 8.5 | % | (7.79 | ) | |||||||||||||||||||||||
General and administrative expenses | 81,552 | 20.16 | 8.6 | % | 65,951 | 19.82 | 8.6 | % | 15,601 | 23.7 | % | 0.34 | ||||||||||||||||||||||||
Impairment of assets | 243 | 0.06 | 0.0 | % | 517 | 0.16 | 0.1 | % | (274 | ) | -53.0 | % | (0.10 | ) | ||||||||||||||||||||||
Total operating expenses | 344,167 | 85.09 | 36.3 | % | 308,264 | 92.63 | 40.0 | % | 35,903 | 11.6 | % | (7.54 | ) | |||||||||||||||||||||||
Operating income | 127,210 | 31.45 | 13.4 | % | 87,030 | 26.15 | 11.3 | % | 40,180 | 46.2 | % | 5.30 | ||||||||||||||||||||||||
Other (expense) income, net | (346 | ) | (0.09 | ) | 0.0 | % | 282 | 0.08 | 0.0 | % | (628 | ) | -222.7 | % | (0.17 | ) | ||||||||||||||||||||
Income before income tax expense | 126,864 | 31.37 | 13.4 | % | 87,312 | 26.24 | 11.3 | % | 39,552 | 45.3 | % | 5.13 | ||||||||||||||||||||||||
Income tax expense | 30,585 | 7.56 | 3.2 | % | 16,460 | 4.95 | 2.1 | % | 14,125 | 85.8 | % | 2.61 | ||||||||||||||||||||||||
Net income | $ | 96,279 | $ | 23.80 | 10.2 | % | $ | 70,852 | $ | 21.29 | 9.2 | % | $ | 25,427 | 35.9 | % | $ | 2.51 | ||||||||||||||||||
Item 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Item 4. | CONTROLS AND PROCEDURES |
PART II. | OTHER INFORMATION |
Item 1. | LEGAL PROCEEDINGS |
Item 1A. | RISK FACTORS |
Item 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs | ||||||||||||
December 30, 2018 to February 2, 2019 | 116 | $ | 127.05 | — | $ | 90,335 | ||||||||||
February 3, 2019 to March 2, 2019 | 219 | 115.78 | — | 90,335 | ||||||||||||
March 3, 2019 to March 30, 2019 | 13 | 187.54 | — | 90,335 | ||||||||||||
March 31, 2019 to May 4, 2019 | 107 | 182.03 | — | 90,335 | ||||||||||||
May 5, 2019 to June 1, 2019 | 79 | 175.67 | — | 90,335 | ||||||||||||
June 2, 2019 to June 29, 2019 | 32 | 187.54 | — | 90,335 | ||||||||||||
Total | 566 | $ | 144.68 | — | 90,335 | |||||||||||
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs | ||||||||||||
December 30, 2018 to February 2, 2019 | 116 | $ | 127.05 | — | $ | 90,335 | ||||||||||
February 3, 2019 to March 2, 2019 | 219 | 115.78 | — | 90,335 | ||||||||||||
March 3, 2019 to March 30, 2019 | 13 | 187.54 | — | 90,335 | ||||||||||||
March 31, 2019 to May 4, 2019 | 107 | 182.03 | — | 90,335 | ||||||||||||
May 5, 2019 to June 1, 2019 | 79 | 175.67 | — | 90,335 | ||||||||||||
June 2, 2019 to June 29, 2019 | 32 | 187.54 | — | 90,335 | ||||||||||||
June 30, 2019 to August 3, 2019 | 73 | 114.14 | — | 90,335 | ||||||||||||
August 4, 2019 to August 31, 2019 | 261 | 135.26 | — | 90,335 | ||||||||||||
September 1, 2019 to September 28, 2019 | — | — | — | 90,335 | ||||||||||||
Total | 900 | $ | 139.47 | — | 90,335 | |||||||||||
Item 3. | DEFAULTS UPON SENIOR SECURITIES |
Item 4. | MINE SAFETY DISCLOSURES |
Item 5. | OTHER INFORMATION |
Item 6. | EXHIBITS |
Exhibit No. | Title | |||
*101.INS | XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||
*101.SCH | XBRL Taxonomy Extension Schema Document | |||
*101.CAL | XBRL Taxonomy Calculation Linkbase Document | |||
*101.LAB | XBRL Taxonomy Label Linkbase Document | |||
*101.PRE | XBRL Taxonomy Presentation Linkbase Document | |||
*101.DEF | XBRL Definition Linkbase Document | |||
*104 | The cover page from this Quarterly Report on Form 10-Q for the quarter ended September 28, 2019, formatted in Inline XBRL (formatted as Inline XBRL and contained in Exhibit 101). |
* | Filed with this report |
** | Designates management contract or compensatory plan or arrangement |
THE BOSTON BEER COMPANY, INC. | ||||||
(Registrant) | ||||||
Date: | /s/ David A. Burwick | |||||
David A. Burwick | ||||||
President and Chief Executive Officer | ||||||
(principal executive officer) |
Date: | /s/ Frank H. Smalla | |||||
Frank H. Smalla | ||||||
Chief Financial Officer | ||||||
(principal financial officer) |
SECURITIES HELD BY HOLDER | ||||